How much does it cost to sell on Amazon?

If you want to sell on Amazon, then the first thing you want to know is how much you will be charged to use the platform. Working out the seller fees for using Amazon is fundamental to succeeding in your business.

This article will shed some light on how much it cost to sell on Amazon, and we will also look at a few ways that you can save money on sales, specifically using Wise.

What are the fees for selling on Amazon?

When you start selling on Amazon, you’ll come across two types of seller fees. These are account fees and commission rates. The amount you are charged for using Amazon will be a combination of these fees.

Account Fees

The amount that you are charged for your Amazon account will depend on the kind of account you set up. Within Amazon Seller Central, you have two account types to choose from: The Basic selling plan, and the Pro selling plan.¹ The type of account plan you choose depends on the size and scope of your business. However, if you’re on the basic plan, there is an extra fee to factor into your total Amazon seller fees.

Here’s a brief overview of the fees associated with each account.

As you can see, the Amazon basic selling plan is suitable for some personal sales. However, if you are planning to sell a lot of items, or anything more complicated, you should get the UK Amazon pro plan.

In addition to an unlimited number of items you can sell in a month, you also get some additional benefits to help you sell better on Amazon:

● You’ll be able to use bulk listing and reporting tools from the Amazon Marketplace web service.

● You can customize your shipping rates, offer special promotions and unique gift-wrapping options for your products (although it does not apply to music videos, DVDs, software, books, and games).

● You’ll also be eligible for top placement on product detail pages.

Additional Fees

In addition to the account fees that you pay due to the type of account you operate, they are also all the fees associated with selling on Amazon.

Here are the fees put together in a nutshell:

Referral Fees

Irrespective of the selling plan that you are using, every Amazon seller has to pay a referral fee on each item sold. This fee is always a percentage of the final price that your item is sold for on the platform.

But why do you have to pay referral fees? Referral fees are more or less payment for the incredible advantage that selling on Amazon provides. Amazon is the fifth largest retailer in the United Kingdom, and as such, built a huge marketplace that brings millions of sellers and buyers together. Therefore, listing on Amazon means that you would have buyers seeing your product without necessarily doing any extra marketing. Referral fees are how you pay for this advantage.

Your referral fee percentage is worked out based on two major pieces of information: the product category that your item belongs to, and the Amazon marketplace that you are selling through.

For Amazon UK sellers, the referral fee percentage ranges from 7% for large appliances to a maximum of 45% for Amazon device accessories. If you want to work out the exact seller fees that you will pay, Amazon has afree fee calculator to help with that.

Closing fees

Closing fees are the extra fees that you pay Amazon when you make a sale on the marketplace. It is a fee that only applies to media items such as books, DVDs, software, video games, gaming consoles, and so on. The fixed cost for closing fees is £0.50 on every media item sold.

Other external fees?

There are also external fees charged depending on how you withdraw your money from Amazon. They disburse funds from your seller account into your bank account regularly. However, there are usually hidden charges when sending or receiving money from Amazon. These fees can be significant and may impact your profit negatively, especially if you are receiving payment from buyers overseas.

If you’re looking to save money on sales, Wise is your best friend. Find out how in the next section

How to save money on sales

One of the main ways Wise helps you save money is converting your money using the real exchange rate without hidden mark-ups. Most payment gateways, including PayPal, charge a markup, meaning that exchange rates are lower than they are in the market, and this way, you get paid even less. Remember that this is after eBay and PayPal might have charged you, respectively.

There's a small fee for converting your money that is always shown upfront so you know exactly how much you'll pay before you make the transfer.

Wise not only saves you money but also provides additional financial services that are tailored to your needs as an online seller. Here are some of them:

• Giving you the capacity to get paid and hold money in over 40 currencies.
• Giving you Wise API access to make payments on a schedule, and to automate things like budget reconciliation and accounting includes integration with Xero and Quickbooks.)
• Batch payment up to 1000 transfers in one go to smooth complicated refunds, commissions, etc.
• A debit card (Wise Business Mastercard) that does automatic, real market-rate currency conversion to help you make payments faster and more convenient.

Start saving today with Wise